Abu Dhabi: Bahrain Petroleum Company (BAPCO) is reducing its fixed costs by ending the contracts of hundreds of foreign employees, according to a spokesperson. Bapco will employ more Bahrainis, especially with the refinery expansion project expected to be completed by 2022.
“Job contracts of all employees, who will be made redundant, are close to expiring and some of the employees have reached retirement age and have high wages,” an official stated.
There were reports that 2020 was difficult for Bapco, with negative refining margins continuing like never before. BAPCO then went for various strategic measures to improve the situation. But the coronavirus struck when a relative improvement in refining margins was seen. This caused huge financial losses in the industry and posed a huge challenge to all of BAPCO’s operations.
“We spend more than we earn, which requires the necessity of making difficult decisions to rationalize expenditures to ensure the continuity of Bapco in the future, and to enhance its substantive contributions to the Kingdom,” said an official report. The reform applies only to ex-pat workers which has caused a lot of distress.
“Unfortunately, despite our strenuous efforts, the decision to reduce our fixed costs to make them smaller and more efficient has become imperative and necessary. We feel very sorry that we have to send termination notices to many of our colleagues.”
The BAPCO’s inception in 1929 marked the start of a radical transformation whose impact was felt in Bahrain and across the region. From a country known for its pearl trade, Bahrain became a pioneer in the oil and gas sector and led the change towards an industrial economy.